Implications of Setting Up a Second Business Through an Existing Limited Company - #AskAMS

I’m setting up a second business. Should I run it through my existing limited company? Well, according to the experts at AMS Accountancy, there are good points as well as bad points.

The answer is yes if:

• Customers are similar
• It’s simply an experiment
• There are no VAT implications
• Admin & time is minimal (bookkeeping, insurance etc.)
• There are no unfair outcomes for shareholders.

The answer could be no if:

• Your current Company is VAT registered and sells to VAT registered businesses. (If your new business sells to consumers, you may want to avoid charging them VAT).
• The businesses have different investors/participators, sharing the same name causes problems.
• One business offers customers credit and gets credit from suppliers - risky if they fail.
• If one is asset rich – its assets could be at risk by the activities of the other business.  

You really should seek advice!